Chinese exports recovered 3.3% in July

Exports to key markets including, ASEAN, UK, EU and South Korea showed positive growth.

China’s exports rebounded and grew 3.3% YoY, in USD terms in July following a 1.3% decline in June whilst imports continue to dip to 5.6% YoY from a 7.3% decline in the previous month, resulting in a narrowed trade surplus to the US at US$27.97b from US$29.92b on a monthly basis, according to the nation’s General Administration of Customs.

Exports grew 0.6% YoY and imports registered a 4.5% YoY decline, respectively. In CNY terms, exports surged to a four-month high at 10.3% YoY in July whilst imports recovered to a 0.4% YoY growth from a 0.4% fall in June.

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Chinese exports to the US contracted by 6.5% YoY, falling for seven out of eight months. Imports from the US fell for the 11th straight month by 19.1% YoY in the same period.

Meanwhile, China’s exports to other key markets mainly recorded gains in July, including ASEAN (15.6%), UK (9.1%), EU (6.5%) and South Korea (9.3%). However, exports to Hong Kong fell (-15.7%), as well as in Japan (-4.1%).

China’s imports to other markets mostly showed declines, particularly in the UK (-22.4%), South Korea (-20.1%), Japan (-13.0%) and EU (-3.4%). China’s imports from ASEAN continued to register its 5th straight monthly growth in July at 0.5% YoY whilst its imports from Hong Kong grew 20.0% YoY.

Ho Woei Chen, economist at UOB Global Economics & Markets Research, noted that the trade between the US and China had fallen 6.5% from end-2018 and may pick up pace ahead as relations worsen.

“Based on the current trajectory (on a 12-month rolling sum basis), the annual US imports from China will likely drop close to or below US$500b by end of this year from US$540b in 2018 whilst annual value of US exports to China could also fall below US$100b from US$120b in 2018,” Chen said.